Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

British Pound Likely to Extend Declines – The Big Picture

Currencies / British Pound Jul 27, 2018 - 10:44 AM GMT

By: Submissions

Currencies

FXOpen writes: The weekly chart of GBP/USD indicates that pair broke key support levels. On the other hand, EUR/GBP may perhaps move higher in the medium term.

Key Points

  • The British Pound started a major downward move from the 1.4375 swing high against the US Dollar.
  • GBP/USD broke a key bullish trend line with support at 1.3720 on the weekly chart.
  • EUR/GBP formed a short-term top near the 0.9300 level and declined.
  • The pair is following a declining channel with resistance near 0.8930 on the weekly chart.

GBP/USD Technical Analysis

The British started a major upward move from the 1.2000 swing low in February 2017 against the US Dollar. The GBP/USD pair traded above the 1.3000 and 1.4000 handles in 2018.



However, the 1.4375-1.4400 area acted as a strong resistance, resulting in a downward move. The pair started a strong decline and moved below the 1.4000 and 1.3500 support levels. Moreover, there was a break below the 38.2% Fib retracement level of the last wave from the 1.1972 low to 1.4376 high.

More importantly, there was a break below a key bullish trend line with support at 1.3720 on the weekly chart. The pair also closed below the 50-week simple moving average to move into a bearish zone.

The next support on the downside is near 1.2900 and the 61.8% Fib retracement level of the last wave from the 1.1972 low to 1.4376 high. Should there be a break below the 1.2900 support, the pair may perhaps accelerate declines towards the 1.2800 and 1.2600 levels.

On the other hand, if GBP/USD corrects higher, it is likely to face resistance near the 1.3400 and 1.3500 levels, which are close to the 21-week SMA. The overall bias is slightly bearish on the weekly timeframe, and only a close back above 1.3500 could push the pair back in a bullish zone.

EUR/GBP Technical Analysis

The Euro gained traction during the last 2017 and moved above the 0.8800 and 0.8900 resistance levels against the British Pound. The EUR/GBP pair traded close to the 0.9300 level where sellers appeared.



The pair started a downside move and declined below the 0.9000 and 0.8900 support levels. There was also a break below the 50% Fib retracement level of the last wave from the 0.8313 low to 0.9306 high.

However, the 0.8650 support area acted as a strong barrier for buyers. Moreover, the 61.8% Fib retracement level of the last wave from the 0.8313 low to 0.9306 high also acted as a support.

The pair is currently recovering and is following a declining channel with resistance near 0.8930 on the weekly chart. More importantly, the pair is trading above the 0.8800 pivot level and the 21-week simple moving average.

Should the pair succeed in clearing the channel resistance near 0.8930 and 0.8950, there could be more gains in EUR/GBP in the near term. Above 0.8950, the pair may perhaps move above the 0.9000 resistance.

On the flip side, if the pair fails to settle above the channel resistance at 0.8930, there may possibly be a downward reaction back toward the 0.8800 support. Below this, the pair is likely to test the channel support near the 0.8600 handle in the medium term.

Overall, the British Pound is under pressure and it could decline further versus the US Dollar and Euro in the medium term.

The market outlook is provided by FXOpen broker.

FXOpen - true ECN/STP Forex and cryptocurrency broker.

© 2018 Copyright FXOpen - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in